If Production Is Not at an Efficient Level, Which of the Following

question 35

Multiple Choice

If production is not at an efficient level, which of the following must be true?

• A)Marginal social benefit exceeds marginal social cost.
• B)Marginal social cost exceeds marginal social benefit.
• C)Production will increase.
• D)Production will decrease.
• E)none of the above

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Definitions:

Cash Cycle

The period between the outlay of cash for raw materials and receiving payment from customers for goods or services, reflecting the efficiency of a company's cash management.

Paying Suppliers

The process of settling financial transactions with suppliers by transferring payment for goods or services received.

Inventory Period

The duration of time it takes for a company to sell its inventory and convert it into sales, often measured in days or months.

Slow-selling Merchandise

Items in inventory that move or sell at a slower pace than anticipated, often leading to excess stock and markdowns.